MR. BARRALES: Thank you all for being on the call. This is Ruben
Barrales. And, again, Kevin Marshall is with us on another phone, as well.
I'm just going to briefly go over the report, which happens to be very
short, very simple and very straightforward, and then I and Kevin are
available to answer any questions that you might have.

We were pleased to be able to take the report to members of Congress this
afternoon, to the President for his review, to other elected officials
around Puerto Rico and other interested individuals in Puerto Rico and
throughout the mainland who have expressed interest in the issue.

I assume you all have a copy of the report. It is, again, as I said,
fairly simple, going over the guiding principles, the executive orders
pertaining to Puerto Rico, an historical overview that gives those of you
who don't have any experience with Puerto Rico and this issue gives you a
quick overview, and a legal analysis of the options for Puerto Rico's
status. In there we identify what we consider to be the three options
allowed for -- (inaudible).

Number one is the current status, which is called the commonwealth status,
which is a territorial status. It is the one that Puerto Rico has now,
allows for limited self-government. Then there is statehood, which,
obviously, is a permanent status. And there is independence, which is
another permanent status. I need to reiterate that commonwealth or
territorial status is one that we see as can be indefinite, but really at
the will of Congress.

The task force makes its recommendations, and in the recommendations we do
ask that Congress take up the issue within a year and allow for the people
of Puerto Rico to be able to vote and decide whether they wish to retain
the current territorial status or move towards a permanent status. And it
provides for another recommendation that if the people choose to elect and
vote for permanent status, that they be given the option of one of the two,
statehood or independence. And then if they initially vote to retain the
current status, which they can do, and keep it as a territory indefinitely
-- (inaudible) -- periodically, Congress may wish to provide for a vote to
gauge the people's will as time moves one.

So it's pretty straightforward. It really is -- as you all know, I'm sure
many of you know that the issue has been going on for over a hundred years.
There have been attempts to resolve it. We have worked with all parties
on the island. The task force has met with anyone who has requested a
meeting. We've read volumes and volumes of material. We have been, and
are willing to work with any of the parties on the island or here on the
mainland to help move the process forward successfully. And we hope to
work in cooperation with all of those involved. And at this point, we hope
that Congress will take a look at the recommendations and hopefully move
the question forward.

So with that, I'm going to see if -- or ask if Kevin has anything he might
want to add.

MR. MARSHALL: I just want to comment on the legal question a little bit.
The primary issue is whether the Constitution allows for some commonwealth
status that couldn't be altered without the consent of Puerto Rico. And we
conclude that it -- the Constitution does not. In reaching that
conclusion, we're reaffirming the position that the Justice Department has
taken for the last 14 years in both the first Bush administration and the
Clinton administration and in the current administration.

But appreciate the importance of the question for Puerto Rico and for the
United States. We have in the Office of Legal Counsel done a thorough
reconsideration of issue, and concluded that that position is correct. And
as part of that, I have met with several superb lawyers representing
various interested parties and I've also received excellent written
material from them, including from the former head of the office where I
work and the former attorney general. And we've appreciated that input
very much and I think it's made the report better.

Q My question, or at least one of them, is this is a report of, sir, a
road map of the status issue? Or is it a plan of action?

MR. BARRALES: Well, it is, again, for those who are not very familiar with
the issue, it does provide an historical overview very briefly -- so in
that sense, maybe, a road map of what's happened to date. And then it
provides what I hope is a level playing field for those who are interested
in moving the process forward in terms of what we think the options are
that are available and our recommendations for a way to move forward, in
terms of our recommendations within the report.

There may be other ways to move forward, and we're interested in working
with anyone who wants to help in that regard.

Q Now, should the content of this report be represented as an
endorsement as to any of the alternatives?

MR. BARRALES: No, this is an inter-agency report. The executive order was
very specific that it is an inter-agency report, review the information,
met with individuals, read material and is now presenting its
recommendations and report -- more of a progress report, you might describe
it as -- to the President and to members of Congress. So it is not
construed as a position of the administration.

MR. MARSHALL: Can I add something? This is Kevin. It was not part of our
mission to state a preference or pick among the options. Our job was
simply to identify what the options were under the Constitution and what a
good way of getting them might be. So the report shouldn't be interpreted
as endorsing any of the options that it lays out for the status of Puerto
Rico.

Q I wanted to ask you -- I didn't hear the very beginning of the call
that you said what is the next step? That you guys are going to be
presenting this to Congress this afternoon?

MR. BARRALES: We did electronically and in hard copy deliver copies of the
report to members of Congress, and also to the governor's office -- and
mainly electronically to other folks who are interested in the issue.

Q Okay. So what happens next? I mean, are they required to -- you're
saying that they hope that they take some action. Are they required to?
Is there a time line for them to respond or to do something?

MR. BARRALES: It's an excellent question. There's absolutely no
requirement, and so I think that's important for people to understand. We
are trying to help move the process forward, and so we've provided what we
hope are helpful recommendations and analysis of the issue.

Q Okay. And this vote, I mean -- so I guess there was no date or time
frame for the vote to actually take place because -- unless Congress --
until Congress actually acts on these recommendations --

MR. BARRALES: As a matter of fact, in the recommendations, we do recommend
that Congress set a date certain for an election, hopefully within a year,
or at least start hearings within the year to begin moving the process
forward.

Q Okay. And let's just say that they don't take any action, I mean, in
the status. As you said, this is an attempt to try to get -- to move
things forward. So if there was no action taken, it would still be the
status quo, then, here?

MR. BARRALES: Well, yes, but I want to make it clear that, for example,
the process could move forward as we recommend, and the people of Puerto
Rice could decide to keep it (inaudible). They could decide to keep --
(inaudible) -- and, you know, if that's what they choose, I think my sense
would be, you know, (inaudible) folks would support.

Q I would like to know if in any way this report is contrary to the
representation that the United States made in 1953 before the United
Nations?

MR. BARRALES: No, I do not believe so.

Q No?

MR. BARRALES: No.

Q Why? Why not? The commonwealth at that time was defined as a
self-governing body and not a (inaudible) anymore.

MR. BARRALES: I understand. I'm very familiar with that. No, it doesn't
-- the report, itself, doesn't change the status quo at all, and basically
we think the people of Puerto Rico should be given an option to choose the
particular status that (inaudible) that they think would work best for
(inaudible). And, no, I don't think it conflicts at all with what happened
in the --

Q The popular Democratic Party, or the executive branch, is saying
already that it's a vague report, that, in some sense, you are forcing the
issue because that will be -- you are trying Puerto Rico to go to statehood
or independence, and probably the alternative to have the votes is the
commonwealth or a new commonwealth.

MR. BARRALES: Yes, we really -- it would have been a much simpler process
if it we already knew where we were going to conclude. No, we worked very
diligently and fair in terms of reviewing all the options. And, again, it
is not up to the task force; it's up to people of Puerto Rico and the
Congress to decide what the future of Puerto Rico should be.

We just tried to very honestly look at the situation, speak with all the
individuals involved, the representatives of the people of Puerto Rico --
from the governor's office, to the legislature, to others -- and we think
that, again, the people and the Congress should decide. And we very much
hope that this helps with that discussion and we look forward to working
with anyone who, in a constructive manner, wants to help move this forward.

Q I have a question regarding the time between the second -- or between
the first and the second recommendation. You said that Puerto Rico should
hold a plebiscite next year. And depending on the result, so the next
plebiscite would be on the current status or the independence or the
conversion of Puerto Rico in another state of the U.S. So do you have a
time for this second plebiscite in Puerto Rico?

MR. BARRALES: That's an excellent question, because as you acknowledged,
we have a time line for the first where we're asking Congress to take a
look at within a year.

But, no, we don't. We thought that was the right approach in terms of the
process. And really, it's going to be up to the people of Puerto Rico and
Congress to work out what might be the best time line in between. It might
relate to when regularly scheduled elections are held, or it may be --
there may be other factors at that time that determine the timing of that
election.

I'm not sure if Kevin might have something to add to that.

MR. MARSHALL: I don't think so. I think that we would be happy to see
Congress move and get past the first step; and then the second one, I
think, as soon as would be feasible after the first step is resolved.

MR. BARRALES: Thank you.

Q I have a couple of questions, if I could. The first one is, why did
you -- why do you, in your proposal, why do you suggest that there be a
plebiscite between -- for people to decide whether they want to remain as a
commonwealth or go into either independence or say -- why don't you just
have a plebiscite where all three choices were given at the same time?

MR. BARRALES: I think that's a good question. Kevin might have something
to add to that. Let me just say that I think it's important for the people
of Puerto Rico and the Congress to decide consciously whether or not they
want to remain as a territory, or to move towards a configuration that is a
permanent one -- either statehood or independence. And I think it's
important to make a conscience decision along those lines.

Now, again, we, as a task force, are not -- we are not taking sides on
which way. And if Puerto Rico chooses to remain as a territory or a
commonwealth, then more power to them; or if they choose the -- one of the
two permanent options. But we wanted it to be a conscience choice.

Q Okay. Now, one other thing --

MR. BARRALES: Kevin may want to --

Q Go ahead. All right.

MR. MARSHALL: I would just say that in the recommendations, we do make the
point that in ascertaining the will of the people of Puerto Rico, which is,
of course, paramount, we want to try to do it in a way that gives clear
guidance to Congress or future actions. Some of the prior votes, I think
we'd all agree, have not provided clear guidance. And it seemed to us that
there was a clear distinction between on the one hand, the current status
-- which can be indefinite, but wouldn't be described as permanent -- and
on the other hand, statehood and independence. And even though those two
are different from each other, they're both a change and what could be
called a permanent status, so that choice seemed like a natural first step.

Q All right. And what about the free association? Is that, in any way
-- has that come into the picture in your discussions? A possibility of
Puerto Rico taking this other step that's not quite independence, but --

MR. BARRALES: Let me address -- Kevin, I'm sure, will have something to
add. Actually, no, we think it is quite independence. We really think
free association would be a configuration of the people and Congress
choosing independence. In other words, we could see a scenario where if
the people and Congress chose to move in the direction of independence,
they might (inaudible), but we want to remain closely associated with the
United States, that that would be moving towards independence. And then
the details of which we don't get into in the report, but there are issues
that relate to dual citizenship, that relate to other ties that would bind
the two together.

Q Okay. Well, if they chose independence, but they really mean free
association, how would that play out?

MR. MARSHALL: I can grab that, if you want.

MR. BARRALES: All right, Kevin, please.

MR. MARSHALL: I think in terms of the recommendations we laid out, I think
that would fit in recommendation two. If they were to decide between
statehood and independence and to choose for independence, that would be a
kind of independence. I think you'll see a fuller explanation of that in
the legal analysis. We could talk about Micronesia and the Marshall
Islands in Palau. We make clear that free association is a form of
independence, but still a variation.

So I think ultimately that would be for Congress, the kind of step two
stage, to spell that out and determine how to go about determining the
exact nature of the independence, because we do explain that.

Q So free association is a choice?

MR. BARRALES: I'm sorry?

Q Free association would be a choice for people to make, for voters in
Puerto Rico to make?

MR. BARRALES: Potentially. We do not prohibit that, in terms of our
recommendation.

Q Okay.

Q I just have one last issue I wanted to discuss with you guys. You
very clearly say in the recommendation that it is the people of Puerto Rico
-- and you reiterated that in this conference -- that it is the people of
Puerto Rico that would have to make a choice as to status, right?

MR. BARRALES: Yes, the people.

Q Now, it makes me think -- and I want you to react to that conclusion
-- that this report could be interpreted as more the White House passing
the ball along to the Congress and the people, than actually intervening
with a voice as to what should be done.

MR. BARRALES: Well, I think most people would agree that to resolve the
issue, it's going to involve the will of the people of Puerto Rico and the
authority of Congress. So those are really the two entities, if you will
-- the people of Puerto Rico and the United States Congress -- that will
really be able to help us reach a conclusion here.

Q But some people might have expected the White House to propose or put
forward a position as to what will be the best option, or what will be the
option the White House would endorse or agree upon. And the report doesn't
do that -- in fact, the White House is actually passing the hot potato to
other hands. You understand?

MR. BARRALES: I know what you're saying, but the task force -- our job was
to recommend to the President, and to the Congress, some suggestions for
moving the process forward. And the hot potato you refer to, no one is
going to cook that potato, we need to put it in the kitchen. And the
people who are going to actually make this happen are the people of Puerto
Rico and the Congress of the United States.